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++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY STATE.
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
REGISTRATION STATEMENT NO. 333-47637
FILED PURSUANT TO RULE 424(a)
SUBJECT TO COMPLETION, MARCH 18, 1998
PROSPECTUS
AGRIBIOTECH, INC.
7,000,000 Shares of Common Stock
This Prospectus pertains to 7,000,000 shares of Common Stock (the "Shares"),
$.001 par value per share, of AgriBioTech, Inc., a Nevada corporation ("ABT"
or the "Company"). The Shares are (a) being registered for issuance by the
Company in exchange for the assets and/or stock of entities which may be
acquired by the Company, including, but not limited to, 1,464,091 shares
anticipated to be issued in connection with the Company's previously announced
acquisitions (the "Pending Acquisitions") and other prospective acquisitions
to the selling stockholders to be named herein or by supplement (the "Selling
Stockholders"), (b) being registered for resale by Selling Stockholders who
received 30,109 shares in lieu of a cash payment to the former owners of Clark
Seeds, Inc., or (c) being registered for original equity issuances to or
resales by (collectively, "Private Placements") qualified institutional buyers
("QIBs"), institutional accredited investors, other accredited investors,
broker-dealers who are members in good standing with the National Association
of Securities Dealers, Inc. or foreign broker-dealers (collectively referred
to herein as "Investors").
The Company will not receive any proceeds from the sale of the Shares by the
Selling Stockholders, although it will receive the purchase price from Private
Placements to Investors at market prices prevailing at the time of sale, at
prices related to such prevailing market prices or at negotiated prices. It is
anticipated that the Selling Stockholders will offer shares of Common Stock
for resale at prevailing prices on the Nasdaq National Market ("Nasdaq"). See
"Plan of Distribution." All selling expenses incurred by individual Selling
Stockholders will be borne by such Selling Stockholders.
The Common Stock is traded on Nasdaq under the symbol "ABTX." On March 9,
1998, the closing sale price of the Common Stock as reported on Nasdaq was
$14.00 per share.
THE SHARES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK. SEE "RISK FACTORS"
BEGINNING ON PAGE 7.
-------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED
BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION NOR HAS THE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
THIS PROSPECTUS ALSO AMEND THE COMPANY'S PROSPECTUSES DATED OCTOBER 10,
1995, OCTOBER 18, 1996 AND DECEMBER 17, 1997.
THE DATE OF THIS PROSPECTUS IS MARCH , 1998
<PAGE>
The registration of the Shares offered hereby is being effected in
connection with registration rights to be granted by the Company pursuant to
the terms of either (i) various asset and stock purchase agreements concerning
the Pending Acquisitions or other prospective acquisitions, or (ii)
prospective Private Placements. In accordance with the terms of such rights,
the Company will bear the expenses of such registration, which are estimated
to be $55,000, except that the Selling Stockholders will bear the cost of all
brokerage commissions and discounts incurred in connection with the sale of
their respective Shares and their respective legal expenses.
Commencing on the effective date of this Prospectus, the Shares may be sold
as original equity issuances to Investors and/or from time to time, by the
Selling Stockholders directly to purchasers, pledged or, alternatively, may be
offered through agents, brokers, dealers or underwriters, who may receive
compensation in the form of commissions or discounts from the Selling
Stockholders or purchasers of the Shares. Sales of the Shares may be made on
Nasdaq, in privately negotiated transactions or otherwise, and such sales may
be made at the market price prevailing at the time of sale, a price related to
such prevailing market price or at a negotiated price.
Any brokers, dealers or agents that participate in the distribution of the
Shares (the "Offering") may be deemed to be underwriters under Section 2(11)
of the Securities Act of 1933, as amended (the "Securities Act"), and any
commissions, discounts and/or other compensation received by them on the sale
or resale of such Shares may be deemed to be underwriting compensation under
the Securities Act. The sale of the Shares by the Selling Stockholders is
subject to the prospectus delivery and other requirements of the Securities
Act. See "Plan of Distribution."
No person has been authorized to give any information or to make any
representations in connection with the Offering other than those contained in
this Prospectus and, if given or made, such other information and
representations must not be relied upon as having been authorized by the
Company. Neither the delivery of this Prospectus nor any sale made hereunder
shall, under any circumstances, create any implication that there has been no
change in the affairs of the Company since the date hereof or that the
information contained herein is correct as of any time subsequent to its date.
This Prospectus does not constitute an offer to sell, or a solicitation of an
offer to buy, the Shares in any circumstances in which such offer or
solicitation is unlawful.
AVAILABLE INFORMATION
The Company is subject to the information requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission"). Reports, proxy statements and other
information filed by the Company may be inspected and copied at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 and at the Commission's regional offices located at the
Northeast Regional Office, Seven World Trade Center, New York, New York 10048,
and at the Midwest Regional Office, 500 West Madison Street, Chicago, Illinois
60611-2511. Copies of such material may be obtained, at prescribed rates, by
writing to the Commission, Public Reference Section, 450 Fifth Street, N.W.,
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<PAGE>
Washington, D.C. 20549 and may be found on the Commission's Worldwide Web site
at http://www.sec.gov.
The Company has filed with the Commission a Registration Statement on Form
S-3 (the "Registration Statement") under the Securities Act with respect to
the Shares offered hereby. This Prospectus, filed as part of the
Registration Statement, does not contain all the information set forth in the
Registration Statement and the exhibits thereto, certain portions of which
have been omitted, as permitted by the rules and regulations of the
Commission. For further information with respect to the Company and the
Shares, reference is hereby made to such Registration Statement and the
exhibits thereto or incorporated therein by reference. The Registration
Statement, including such exhibits, may be inspected without charge at the
public reference facilities maintained by the Commission, at the Commission's
regional offices at the addresses stated above and on the Commission's Web
site. Copies of these documents may be obtained, at prescribed rates, by
writing to the Commission's Public Reference Section at the address set forth
above.
INFORMATION INCORPORATED BY REFERENCE
The following documents filed by the Company with the Commission are by this
reference incorporated into and made a part of this Prospectus: (i) the
Company's Annual Report on Form 10-KSB (as amended) for the fiscal year ended
June 30, 1997 ("Form 10-KSB");(ii) the Company's Quarterly Reports on Form 10-
Q for the fiscal quarters ended September 30, 1997 (as amended) and December
31, 1997, as amended ("Forms 10-Q"), (iii) the Company's Current Reports on
Form 8-K for October 30, 1996 (as amended), May 15, 1997 (as amended), August
22, 1997 (as amended), October 22, 1997, December 1, 1997, January 6, 1998 (as
amended), January 9, 1998 (as amended) and January 26, 1998 ("Forms 8-K");
(iv) the description of the Company's Common Stock, $.001 par value, contained
in the Company's registration statement on Form 8-A (File No. 0-19352), filed
July 11, 1995, pursuant to Section 12(g) of the Exchange Act including any
amendment or report filed for the purpose of updating such information; (v)
the Company's Proxy Statement dated January 20, 1998; and (vi) all documents
filed by the Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the
Exchange Act subsequent to the date of this Prospectus and prior to the filing
of a post-effective amendment which indicates that all the securities offered
hereby have been sold or which deregisters all the securities remaining
unsold. Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained
herein or in any other subsequently filed document which also is or is deemed
to be incorporated by reference herein modifies or supersedes such statement.
Any such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
Copies of all documents that are incorporated herein by reference (not
including the exhibits to such documents, unless such exhibits are
specifically incorporated by reference into such documents or into this
Prospectus) will be provided without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon a written or oral
request to
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AgriBioTech, Inc., Attention: Secretary, 2700 Sunset Road, Suite C-25, Las
Vegas, NV 89120; telephone number (702) 798-1969.
THE COMPANY
AgriBioTech, Inc. (the "Company" or "ABT") is the largest agricultural seed
company in the United States that specializes in developing, processing,
packaging and distributing varieties of forage and cool season turfgrass
seeds. Since January 1, 1995, the Company has completed 17 acquisitions and
has executed letters of intent to acquire seven additional companies. The
Company has grown from net sales of $29,000 in fiscal 1994 to pro forma net
sales of approximately $336 million for the fiscal year ended June 30, 1997,
including completed and Pending Acquisitions. The Company's vertically
integrated forage and turfgrass seed operations include traditional genetic
breeding and research and development programs for most forage and cool season
turfgrass species, seed processing plants that clean, condition and package
ABT's products, and national and international distribution and sales networks
in 48 states and 51 countries.
The Company was incorporated in the State of Colorado on December 31, 1987
under the name Sussex Ventures, Ltd. ("Sussex"). The Company was an inactive
development stage company until September 30, 1993 when it acquired all of the
outstanding stock of AgriBioTech, Inc., a Nevada corporation ("ABT"). ABT was
treated as the acquiring corporation in the transaction, which was accounted
for as a reverse purchase. In June 1994, the Company merged with and into
ABT, then a wholly-owned subsidiary of the Company, and changed its name to
AgriBioTech, Inc. and became a Nevada corporation. The Company had limited
revenues until 1995, when it commenced its acquisition program.
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<PAGE>
THE OFFERING
Shares of Common Stock to be offered ....................... 7,000,000 (1)
Shares of Common Stock issued and outstanding
before the offering ........................................ 31,208,738 (2)
_______________
(1) Consists of shares of Common Stock reserved for issuance in connection
with (a) future acquisitions, including the pending acquisitions of
Discount Farm Center, Inc., Zajac Performance Seeds, Inc., Ohio Seed
Company, Van Dyke Seed Co., Inc., Las Vegas Fertilizer Co., Inc., Kinder
Seed, Inc. and Willamette Seed Co. (the "Pending Acquisitions") (see
"Recent Developments"), other prospective acquisitions or (b) prospective
Private Placements, and (or) for resale by Selling Stockholders who
received 30,109 shares in lieu of a cash payment to the former owners of
Clark Seeds, Inc.
(2) Based on 31,208,738 shares outstanding as of February 23, 1998, but does
not give effect to (i) 6,254,916 shares of Common Stock reserved for
issuance upon exercise of stock options currently outstanding and an
additional 2,076,850 shares of Common Stock issuable upon exercise of
options available for future grants under the 1994 Plan and; (ii) 400,000
shares of Common Stock reserved for issuances upon grant of shares under
the Bonus Plan; (iii) 305,202 shares of Common Stock issuable as of
February 23, 1998, upon conversion of Preferred Stock outstanding.
Use of
Proceeds: The Company will not receive any proceeds from the sale of the
-------- Securities offered by the Selling Stockholders. The Company will
receive proceeds from Private Placements to Investors at market
prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices and will use such
proceeds for working capital purposes, including, but not limited
to, the funding of potential acquisitions.
Risk
Factors: Investment in the Shares offered hereby involves certain risks
------- discussed under "Risk Factors" that should be considered by
prospective investors.
RECENT DEVELOPMENTS
PENDING ACQUISITIONS
The Company has signed letters of intent in connection with the Pending
Acquisitions, described hereinafter, all of which the Company expects to close
before the end of the fiscal year ending June 30, 1998 ("Fiscal 1998"). Since
each acquisition is subject to conditions and events which may not necessarily
occur, no assurance can be given that any of the following acquisitions will
be completed.
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<PAGE>
. Discount Farm Center, Inc. ("Discount"), Watertown, South Dakota -- sales
of approximately $5.8 million for the 12 month period ended June 30,
1997; a purchase price of approximately $3.4 million, payable $1.7
million in cash and 115,591 shares of the Company's Common Stock, which,
at the time the terms were agreed to, was valued at $15.03 per share;
effective February 1, 1998. Discount is a supplier of forage small
grains, other forages and birdseed in the Midwest.
. Van Dyke Seed Co., Inc. ("Van Dyke"), Forest Grove, Oregon -- sales of
approximately $9.7 million for the 12 month period ended June 30, 1997;
purchase price of approximately $8.2 million, payable $3.6 million in
cash and 460,000 shares of the Company's Common Stock, which, at the time
the terms were agreed to, was valued at $10.00 per share; effective
January 1, 1998. Van Dyke is a production company with a wholesale
distribution base of a number of forage crops, such as red clover and
crimson clover.
. Zajac Performance Seeds, Inc. and its Oregon affiliate (collectively,
"Zajac"), North Haledon, New Jersey, sales of approximately $8.4 million
for the 12 month period ended June 30, 1997; a purchase price of
approximately $6.6 million, payable $3.6 million in cash and 300,000
shares of the Company's Common Stock, which, at the time the terms were
agreed to, was valued at $10.00 per share; effective January 1, 1998.
Zajac specializes in providing proprietary turfgrass varieties to
independent wholesale distributors under private label. Zajac's Oregon
operations include a production facility and a distribution base.
. Ohio Seed Company ("Ohio Seed"), West Jefferson, Ohio -- sales of
approximately $9.3 million for the 12 month period ended June 30, 1997; a
purchase price of approximately $3.8 million, payable $1.8 million in
cash and 200,000 shares of the Company's Common Stock, which, at the time
the terms were agreed to, was valued at $10.00 per share; effective March
1, 1998. Ohio Seed is a distribution company with approximately 60%
turfgrass seed and 40% forage seed, with sales primarily in Ohio and
Michigan.
. Las Vegas Fertilizer Co., Inc. ("LVF") , Las Vegas, Nevada -- sales of
approximately $14.4 million for the twelve month period ended June 30,
1997; a purchase price of approximately $10.0 million, payable $5.0
million in cash and 295,000 shares of the Company's Common Stock, which,
at the time the terms were agreed to, was valued at $17.00 per share;
effective January 1, 1998. LVF specializes in the distribution of
turfgrass seed and ancillary products to golf courses and lawn and garden
products to home improvement centers, mass merchandisers and independent
nurseries in Nevada, California, Utah, Idaho and Wyoming.
. Kinder Seed, Inc. ("Kinder"), Buffalo, New York -- sales of
approximately $2.8 million for the 12 month period ended June 30, 1997; a
purchase price of approximately $3.5 million, payable $2.0 million in
cash and 93,500 shares of the Company's Common Stock, which, at the time
the terms were agreed to, was valued at $16.00 per share; effective
February 1, 1998. Kinder is a forage and turfgrass distribution company
located in the Northeastern United States.
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<PAGE>
. Willamette Seed Company ("Willamette"), Albany, Oregon -- sales of
approximately $41.8 million for the 12 month period ended June 30, 1997;
a purchase price of approximately $13.6 million, payable in cash, or cash
and shares of the Company's Common Stock (to be valued at the date of
closing) depending on each shareholder's election; effective March 1,
1998. Willamette is a production turfgrass seed company which markets to
wholesale distributors in the United States and internationally;
Willamette also provides fertilizers to Oregon farmers who grow turfgrass
seed under contract.
RISK FACTORS
In addition to considering the other information set forth in, or
incorporated by reference into, this Prospectus, prospective investors should
carefully consider the following factors in evaluating an investment in the
Company. This Prospectus, including the documents incorporated by reference
herein, contains forward-looking statements within the meaning of Section 27A
of the Securities Act. Also, documents subsequently filed by the Company with
the Securities and Exchange Commission (the "Commission"), and incorporated
herein by reference will contain forward-looking statements. Actual results
could differ materially from those projected in the forward-looking statements
as a result of the risk factors set forth below and the matters set forth or
incorporated in this Prospectus generally. The Company cautions the reader,
however, that this list of factors may not be exhaustive, particularly with
respect to future filings. In analyzing an investment in the securities
offered hereby, prospective investors should carefully consider, along with
the other matters referred to herein, the risk factors described below.
Ability to Manage Growth. The Company has acquired all or part of 17
------------------------
seed companies since January 1, 1995, has signed letters of intent to acquire
seven additional seed companies and intends to expand current levels of
operations. The Company's rapid growth since January 1995 has placed and may
continue to place significant demands on the Company's management, technical,
financial and other resources. In addition, successful expansion of the
Company's operations will depend on, among other things, its ability to
attract, hire and retain skilled management and other personnel, secure
adequate sources of seed on commercially reasonable terms and successfully
manage growth, none of which can be assured. To manage growth effectively, the
Company will need to improve operational, financial and management information
systems, procedures and controls. There can be no assurance that the Company
will be able to manage its future growth effectively, and failure to do so
could have a material adverse effect on the Company's business, financial
condition and/or operating results. See "Management's Discussion and Analysis
or Plan of Operations" in the Form 10-KSB and "Management's Discussion and
Analysis of Financial Condition and Results of Operations" in the Forms 10-Q
(collectively, "MD&A") and "Business -Acquisition Program" in the Form 10-KSB.
Integration of Acquisitions. The Company is in the process of
---------------------------
integrating its recent acquisitions, and intends to expand current levels of
operations through additional acquisitions. The Company's future success
depends upon its ability to combine the operations of its acquired
subsidiaries into a vertically integrated company. The Company's acquired
subsidiaries, many of
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<PAGE>
which are geographically disparate, represent the full spectrum of the forage
and turfgrass seed production, processing, sales and distribution process. The
Company's prospects must therefore be evaluated in light of the problems,
expenses, delays and complications associated with operating, managing and
integrating a large group of businesses and/or subsidiaries. There can be no
assurance that the Company will be able to effectively integrate the acquired
subsidiaries, and failure to do so could have a material adverse effect on the
Company's business, financial condition and/or operating results. See MD&A and
"Business - Acquisition Program" in the Form 10-KSB.
No Assurance of Future Growth and Acquisition Strategy. The Company has
------------------------------------------------------
experienced significant growth in net sales, from $29,000 in fiscal 1994 to
$66 million in the fiscal year ended June 30, 1997 ("Fiscal 1997") and to pro
forma net sales of approximately $336 million for Fiscal 1997. Although a
portion of such growth is attributed to year-over-year sales growth of
companies acquired more than one year ago, a significant amount of such growth
has resulted from the Company's acquisitions. The Company's future growth
will depend upon its ability to continue to make acquisitions, as well as
increase sales from existing operations, neither of which can be assured.
The Company is unable to predict whether and when any prospective
acquisition candidate will become available or the likelihood that any
acquisition will be completed. The Company competes for acquisition candidates
with many entities that have substantially greater resources than the Company.
While the Company has been able to complete 17 acquisitions during the last
three years, the Company expects to face intensified competition as the
Company's acquisition program has become well known in the seed industry.
There can be no assurance that the Company will be able to successfully
identify suitable acquisition candidates, complete acquisitions and integrate
and expand acquired companies into its operations. Once integrated, there can
be no assurance that acquired businesses will achieve comparable levels of
sales, profitability, or productivity as existed prior to their acquisition.
There have been previous unsuccessful attempts by others to consolidate the
forage and/or turfgrass seed sectors. To the Company's knowledge, however,
each of these attempts preceded the developments concerning the Plant Variety
Protection Act (the "PVPA"), discussed under "Business--Proprietary Rights" in
the Form 10-KSB. Nevertheless, in view of the fact that no other company has
successfully vertically integrated and consolidated the forage and turfgrass
seed sectors, there can be no assurance the Company will be successful in its
efforts.
Development of New Products. The Company continues to develop new,
---------------------------
genetically superior forage and turfgrass varieties. The Company believes
that the development and marketing of such elite varieties will play a key
role in the Company's success. There can be no assurance that the Company
will develop such genetically superior strains either on its own or with
industry partners. If the Company is unable to develop and successfully
market new product lines, this could have a material adverse effect on the
Company's business, financial condition and results of operations. See
"Business--Research and Development" in the Form 10-KSB.
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<PAGE>
Market Acceptance. Potential investors should be aware that even if the
-----------------
Company is successful in developing genetically superior strains as stated
above, there can be no assurance that there will be a market for such
products; or, if such a market develops that the Company will be able to
recoup the costs associated with the development of these products. If the
Company is unable to effectively market products it has developed, at prices
sufficient to (i) cover the Company's costs and (ii) generate adequate return
on the Company's capital, the Company's business, financial condition and
results of operations may be materially adversely affected.
Reliance on Patents and Proprietary Rights. The Company owns proprietary
------------------------------------------
varieties for a number of forage and turfgrass species that are protected
under the PVPA and is seeking to acquire and/or develop other varieties
protected by the PVPA. The PVPA prohibits others from selling seed of those
proprietary varieties for 20 years, after which such protection expires. The
inability to develop protected varieties could have a material adverse impact
on the Company's business, financial condition and results of operations.
There can be no assurance that any proprietary rights owned by the Company or
licensed from third parties will not be challenged, invalidated, or
circumvented, or that the rights held by the Company will provide any
competitive advantage, or that the Company's competitors will not possess
protected varieties that perform better than those of the Company. The
Company could also incur substantial costs in asserting its proprietary rights
against others, including any such rights obtained from third parties, and/or
defending any infringement suits brought against the Company. See "Business--
Proprietary Rights" in the Form 10-KSB.
Access to Biotechnology. Breakthroughs in biotechnology have led to the
-----------------------
introduction of new, improved and specialized seeds in other seed sectors,
such as corn, soybeans and cotton. The Company believes that similar
breakthroughs in biotechnology will also lead to the introduction of enhanced
seeds in the forage and turfgrass sectors. The Company is attempting to become
the licensee or partner of choice for owners of value-added genetic traits in
order to accelerate the introduction of these traits to its customers through
biotechnologically enhanced products. In addition to the risks described above
under "Development of New Products" and "Market Acceptance" there can be no
assurance that the Company will succeed in its efforts to license
biotechnology genes and develop partnerships with such owners. The Company's
inability to develop or market products through biotechnology at prices
sufficient to recover its costs and generate adequate returns on capital
could have a materially adverse effect on the Company's future business,
financial condition and results of operations. See "Business--Proprietary
Rights" in the Form 10-KSB.
Competition. The seed industry and the field of agricultural technology
-----------
are both highly competitive. The Company competes in the forage and turfgrass
seed sectors primarily on the basis of price, product quality and service. The
major agricultural seed companies in the United States focus their sales
around hybrid seed corn (Pioneer Hi-Bred International, DEKALB Genetics
Corporation, Novartis AG and Mycogen Corporation), cotton seed (Delta and Pine
Land Company) and other crops. In the past, these companies have treated
forage and turfgrass seeds as ancillary crops when they compete in the
marketplace. This is the opposite of the Company's business strategy, which
is to treat forage and turfgrass seed as its primary product. Therefore, the
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<PAGE>
Company's major competitors in the forage and turfgrass seed sectors currently
are large regional companies and numerous small family seed businesses.
However, any of the major agricultural seed companies may decide to intensify
their efforts in the forage and turfgrass seed sectors. Management believes
that as the Company's acquisition strategy becomes better known in the seed
industry, the competition for acquisitions, sales, facilities and personnel
will intensify. The largest United States alfalfa competitors are Cenex/Land
O' Lakes/Research Seed, Helena/AgriPro, Pioneer and Cal/West Seeds. The
largest competitors for other forages are FFR Research and its farm
cooperative members. There are also small family owned businesses that are
strong competitors in small geographic areas. The largest producers and
marketers of turfgrass seed (excluding the Company) in the United States are
Pennington Seed and O.M. Scott.
The Company currently competes with, and in the future expects that it
will have to compete directly with, companies with substantially greater
financial, marketing, personnel and research and development resources than
those of the Company. There can be no assurance that the Company will be able
to compete successfully against such companies. These competitive factors
could have a material adverse effect on the Company's business, results of
operation and/or financial condition.
Lack of Historical Profitability; Leverage. The Company has reported
------------------------------------------
only two profitable quarters, both in calendar 1997, since becoming a publicly
owned company in September 1993. Potential investors should be aware that over
the life of the Company, the Company has not reported a profitable fiscal year
and has failed to show consistent profitability. There can be no assurance
that the Company will achieve or maintain consistent profitability in the
future. The Company had an accumulated deficit of $13,033,561 through
December 31, 1997.
The Company has incurred a substantial amount of indebtedness in
connection with certain of its acquisitions during the course of the last
three years. In the event that the Company incurs substantial indebtedness in
the future, the effect of such leverage may negatively impact the ability of
the Company to (i) obtain additional financing on favorable terms; (ii)
service such long-term indebtedness; and (iii) comply with financial and other
covenants and operating restrictions imposed by such indebtedness.
The ability of the Company to satisfy any such future obligations will
primarily depend upon the future financial and operating performance of its
operating subsidiaries and upon the Company's ability to renew or refinance
bank borrowings and/or to raise additional equity capital. The Company's
future performance is dependent upon financial, business and other economic
factors affecting the Company and the agriculture industry in particular, many
of which are beyond the control of the Company and its subsidiaries. See MD&A
and the financial statements in the Form 10-KSB and Forms 10-Q.
Need for Future Capital. The Company's capital requirements have been
-----------------------
and are expected to continue to be significant. The Company plans to use a
portion of the net proceeds of this offering to fund Pending Acquisitions and
biotechnology research and development. There can be no
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<PAGE>
assurance, however, that existing sources of capital will be sufficient to
fund its future operations. The Company's future capital requirements will
depend on numerous factors including, but not limited to, the timing and cost
of any future acquisitions and the time and cost involved in integrating the
Company's acquisitions and growing the Company's existing operations. See
MD&A and "Business--Biotechnology Access" in the Form 10-KSB.
Dependence on Key Personnel. The success of the Company is largely
---------------------------
dependent upon the efforts, abilities and expertise of Dr. Johnny R. Thomas,
Chief Executive Officer, as well as each of the Company's six other executive
officers. The loss of any of these key personnel could have a material
adverse effect on the Company's business, financial condition and results of
operations. The Company has applied for a key-man life insurance policy in the
amount of $3,000,000 on the life of Dr. Thomas. The Company's prospects
depend upon its ability to attract and retain qualified marketing, financial,
management information system, and other technical personnel. Competition for
such personnel is intense and there can be no assurance that the Company will
be successful in attracting or retaining such personnel. See "Management" in
the Form 10-KSB.
Cyclical Nature of Agricultural Products. Agricultural products,
----------------------------------------
including forage and turfgrass seed, generally follow cyclical business
patterns. Most agricultural products are commodities that are subject to wide
fluctuations in price based on supply of the products and demand for, in this
case, the raw or processed seed. Furthermore, the demand for seed is
dependent on the demand of farmers, which is influenced by the general farm
economy. The production of seed is subject to a variety of nature's
adversities including drought, wind, hail, disease, insects, early frost and
numerous other forces that could adversely affect the growing of seed in any
growing season, resulting in larger fluctuations in results of operations
between quarters. See "Management's Discussion and Analysis of Financial
Condition and Results of Operations--Seasonality of Business and Quarterly
Comparisons" in the Form 10-KSB.
Seasonality of Quarterly Results. The Company's seed business is subject
--------------------------------
to wide seasonal fluctuations which reflect the typical purchasing and growing
patterns for forage and turfgrass crops. In addition, weather affects
commodity prices, seed yields and planting decisions by farmers. Results of
operations from quarter to quarter will not necessarily reflect the results
for the entire year and are not necessarily indicative of results which may be
expected for any other interim period. Management believes that quarterly
sales will continue to fluctuate significantly depending on, among other
things, the breakdown of the Company's sales between the forage and turfgrass
sectors for any specific period of time. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations--Seasonality of
Business and Quarterly Comparisons" in the Form 10-KSB.
Government Regulation. The Company's operations are directly and
----------------------
indirectly subject to various Federal and state environmental controls and
regulations. Management believes that the Company is in substantial
compliance with existing environmental regulations, but can give no
-11-
<PAGE>
assurance that it can maintain such compliance without incurring substantial
cost and expense if additional laws and regulations are enacted or
promulgated.
While not affecting the Company's operations, certain government
regulations may have an effect on the demand for the Company's products. For
example, from time to time the federal government has imposed restrictions on
the sale of certain commodities to certain countries, including commodities
the seed for which are produced by the Company. In addition, United States
government agricultural policies are designed to maintain a balanced supply
and demand for certain commodities by regulating planted acreage through set-
asides in certain crops. Adherence to set-asides is the basis for farmer's
eligibility for government subsidy payments and other benefits. An increase
in the set-aside for a crop generally reduces farmer demand for seed for that
crop, and a decrease in the set-aside generally increases demand for that
seed. In addition, other government policies, such as subsidizing export
sales of certain commodities, ultimately affect seed sales. Certain of the
Company's sales of seed are subject to demand swings resulting from changes in
these programs.
Adoption of regulations regarding the allocation of water in California,
Arizona and other states with limited water supplies could result in a
reduction of the number of acres planted with various crops, reducing the
demand for the Company's products in those states.
The development of seed of genetically altered plants is regulated by the
Environmental Protection Agency (the "EPA"), the U.S. Department of
Agriculture (the "USDA"), the Food and Drug Administration and various state
agencies. The Federal agencies require permits for field testing and the EPA
also regulates insecticide and herbicide products. The Company is not aware
of any pending legislation that would materially impact either its traditional
product development or commercialization of seed from genetically altered
plants. There can be no assurance that regulatory agencies administering
existing or future regulations or legislation will allow the Company to
produce and market genetically engineered seed, if at all, in a timely manner
or under technically or commercially feasible conditions. The Company's
inability to produce such seed could have a material adverse effect on the
Company.
Adverse Effect of Potential Future Sales of Common Stock. Of the
--------------------------------------------------------
Company's 31,208,738 issued and outstanding shares of Common Stock as of
February 23, 1998, approximately 3,400,000 shares are "restricted securities"
as that term is defined under Rule 144 under the Securities Act. All but
approximately 1,030,000 of these restricted shares have been registered for
resale under the Securities Act. As of February 23, 1998, an additional
6,254,916 shares of Common Stock were issuable without restriction upon
exercise of outstanding options and 305,202 shares of Common Stock upon
conversion of outstanding shares of convertible Preferred Stock, and are
either exempt from registration or have been registered under the Securities
Act. The Company is unable to predict the effect that sales made under Rule
144, sales made pursuant to registration statements, or otherwise, may have on
the then existing market price of the Company's securities. The possibility
exists that the sale of any of these Securities, or even the potential of such
sales, may be expected
-12-
<PAGE>
to have a depressive effect on the price of the Company's securities in any
public trading market. This could impair the Company's ability to raise
additional equity capital.
Public Market Risks; Possible Volatility of Securities Prices. The
-------------------------------------------------------------
market price for the Company's securities has been and may continue to be
volatile. Factors such as the Company's financial results, financing efforts,
changes in earnings estimates by analysts, conditions in the Company's
business and various factors affecting the agricultural industry generally may
have a significant impact on the market price of the Company's securities.
Additionally, in the last several years, the stock market has experienced a
high level of price and volume volatility, and market prices for many
companies, particularly small and emerging growth companies, the common stock
of which trades in the over-the-counter market, have experienced wide price
fluctuations and volatility which have not necessarily been related to the
operating performance of such companies themselves. Any such fluctuations or
general economic and market trends could adversely affect the price of the
Company's securities. In view of the foregoing factors, in some future
quarters the Company's operating results may be below the expectations of
public market analysts and investors. In that event, the price of the
Company's securities would likely be materially adversely affected. See
"Market for Common Equity and Related Stockholder Matters" in the Form 10-KSB.
Immediate Substantial Dilution. The Company's present stockholders
------------------------------
acquired their shares of Common Stock at costs substantially below the
offering price of the Common Stock to be sold in this offering. Therefore,
investors purchasing Common Stock in this offering will incur an immediate and
substantial dilution.
-13-
<PAGE>
SELECTED FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
The selected financial data in the following table should be read in
conjunction with the Company's Financial Statements and the Notes thereto,
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" and other financial information incorporated by reference herein.
The historical selected financial data presented below under the captions
"Statement of Operations Data" and "Balance Sheet Data" for, and as of the end
of each of the years ended June 30, 1997 and 1996, the nine-month period ended
June 30, 1995, and each of the years ended September 30, 1994 and 1993 are
derived from the consolidated financial statements of ABT and subsidiaries,
which financial statements have been audited by KPMG Peat Marwick LLP,
independent certified public accountants. The consolidated financial statements
as of June 30, 1997 and 1996, and for the years then ended and the nine-month
period ended June 30, 1995, and the reports thereon, are incorporated by
reference in this Prospectus. The selected financial data presented below for,
and as of the end of, the six months ended December 31, 1997 and 1996 are
derived from the unaudited consolidated financial statements of the Company
incorporated by reference in this Prospectus. In the opinion of management, the
unaudited consolidated financial statements for the interim periods include all
adjustments (consisting of normal recurring accruals) necessary for a fair
presentation of the results for such periods. The results of operations for the
six months ended December 31, 1997 are not necessarily indicative of the results
to be expected for the full year. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations--Seasonality of Business and
Quarterly Comparisons" and "Business--Acquisition Program" in the Company's Form
10-KSB for information that affects a comparison of the Company's quarterly
results of operations.
STATEMENT OF OPERATIONS DATA:
<TABLE>
<CAPTION>
SIX MONTHS YEAR ENDED
ENDED DECEMBER 31, YEAR ENDED JUNE 30, NINE MONTHS JUNE 30,
------------------ ------------------- ENDED JUNE 30,--------------
1997 1996 1997 1996 1995(1) 1994 1993
------- ------- ------- ------- -------------- ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Net sales............... $63,815 $20,941 $65,904 $25,962 $ 4,754 $ 29 $ 12
Cost of sales........... 51,586 16,174 49,527 19,236 3,398 12 3
------- ------- ------- ------- ------- ------ ------
Gross Profit............ 12,229 4,767 16,377 6,726 1,356 17 9
Operating expenses...... 12,679 6,833 17,972 9,637 2,779 915 171
------- ------- ------- ------- ------- ------ ------
Earnings (loss) from
operations............. (450) (2,066) (1,595) (2,911) (1,423) (898) (162)
Other income (expense).. (158) (408) (1,119) (413) (16) (8) (30)
------- ------- ------- ------- ------- ------ ------
Net (loss).............. (608) (2,474) (2,714) (3,324) (1,407) (890) (192)
Discount and imputed
dividends on preferred
stock.................. 53 2,978 3,233 2,318 -- -- --
------- ------- ------- ------- ------- ------ ------
Net (loss) attributable
to common stock........ $ (662) $(5,452) $(5,947) $(5,642) $(1,407) $ (890) $ (192)
======= ======= ======= ======= ======= ====== ======
Shares of common stock
used in computing
(loss) per share of
common stock:
Basic.................. 25,905 10,809 15,549 7,459 5,485 3,911 1,205
Diluted................ 25,905 10,809 15,549 7,459 5,485 3,911 1,205
Net (loss) per share of
common stock:
Basic.................. $ (0.03) $ (0.50) $ (0.38) $ (0.76) $ (0.26) $(0.23) $(0.16)
Diluted................ $ (0.03) $ (0.50) $ (0.38) $ (0.76) $ (0.26) $(0.23) $(0.16)
</TABLE>
BALANCE SHEET DATA:
<TABLE>
<CAPTION>
JUNE 30, SEPTEMBER 30,
DECEMBER 31, ----------------------- -------------
1997 1997 1996 1995(1) 1994 1993
----------- ------- ------- ------- ------ -------
<S> <C> <C> <C> <C> <C> <C>
Cash and cash
equivalents............ $ 8,236 $ 2,554 $ 2,522 $1,423 $441 $ 14
Total assets............ 106,355 96,113 26,184 8,014 765 309
Long-term obligations... 5,274 2,667 1,055 148 106 213
Total liabilities....... 25,758 50,125 12,161 1,681 261 384
Working capital......... 37,954 7,555 6,461 3,792 375 (157)
Stockholders' equity.... 80,597 44,988 14,022 6,333 504 (75)
</TABLE>
- -------
(1) The Company changed its fiscal year end to June 30th effective in 1995.
14
<PAGE>
SELLING STOCKHOLDERS
An aggregate of 7,000,000 Shares are issuable to (a) various persons in
connection with completed, pending and future acquisitions by the Company
including, but not limited to, 30,109 shares listed in the table below issued
in connection with a completed acquisition and 1,464,091 shares anticipated to
be issued in connection with the Pending Acquisitions, or (b) in Private
Placements to Investors.
The following table sets forth information as of March 2, 1998, based on
information obtained from the Selling Stockholders named below, with respect
to the beneficial ownership of Shares being registered hereunder; the number
of Shares known to the Company to be held by each; the number of Shares to be
sold by each; and the percentage of outstanding shares of Common Stock
beneficially owned by each, before this offering and assuming that no Shares
will be owned after this offering.
<TABLE>
<CAPTION>
Percentage of Outstanding
Amount and Nature of Number of Shares to Shares Owned Before
Name Beneficial Ownership(1) be Sold Offering(2)
----- ------------------------ ------------------- ----------------------------
<S> <C> <C> <C>
Fred and Janice Clark 134,887 (3)(4) 16,560 *
Brent Clark 66,691 (3)(4) 4,516 *
Steven Jensen 48,398 (3)(5) 3,844 *
Gary Parker 8,021 (6)(7) 2,205 *
Ruth Lytle 6,892 (6)(8) 1,492 *
Curt Croshaw 11,892 (6)(4) 1,492 *
</TABLE>
_____________________
* Less than 1%
(1) Unless otherwise noted, the Company believes that all persons named in
the table have sole investment power with respect to all shares of Common
Stock beneficially owned by them. A person is deemed to be the
beneficial owner of securities that can be acquired by such person within
60 days from the date hereof upon the exercise of warrants or options.
Assumes, for each person, that the exercisable and convertible Securities
that are held by such person (but not those held by any other person) and
which are exercisable or convertible within 60 days from the date hereof
have been exercised.
(2) Based on 31,208,738 shares of Common Stock issued and outstanding as of
February 23, 1998.
(3) These shares were issued in lieu of a cash payment due on January 1, 1998
to the former owners of Clark Seeds, Inc.
(4) Excludes 1,400 shares, 11,000 shares and 40,000 shares issuable to Fred
and Janice Clark, Brent Clark and Curt Croshaw, respectively, issuable
upon exercise of options not currently exercisable.
(5) Includes 1,900 shares issuable upon exercise of currently exercisable
options, but excludes 2,000 shares issuable upon exercise of options not
currently exercisable.
(6) These shares were issued to authorized "stand-by" purchasers of common
stock not taken by the former owners of Clark Seeds, Inc.
(7) Includes 1,200 shares issuable upon exercise of currently exercisable
options, but excludes 600 shares issuable upon exercise of options not
currently exercisable.
(8) Includes 5,400 shares issuable upon exercise of currently exercisable
options, but excludes 25,100 shares issuable upon exercise of options
not currently exercisable.
-15-
<PAGE>
DESCRIPTION OF SECURITIES
AUTHORIZED
----------
The authorized capital stock of the Company consists of 75,000,000 shares
of Common Stock, $.001 par value, and 10,000,000 shares of Preferred Stock,
$.001 par value. The following summary description of the Company's capital
stock is qualified in its entirety by reference to the Company's Certificate
of Incorporation and By-Laws, copies of which have been filed as exhibits to
the Registration Statement of which this Prospectus is a part.
COMMON STOCK
------------
The Company is authorized to issue 75,000,000 shares of Common Stock,
$.001 par value per share, of which 31,208,738 shares were issued and
outstanding as of February 23, 1998. All of the outstanding shares of Common
Stock and those issuable upon completion of this offering, are and will be,
duly authorized, validly issued, fully paid and non-assessable. Holders of
shares of Common Stock are entitled to one vote for each share held of record
on all matters to be voted on by shareholders. There are no preemptive,
subscription, conversion or redemption rights pertaining to the Common Stock.
Holders of shares of Common Stock are entitled to receive such dividends as
may be declared on Common Stock by the Board of Directors out of funds legally
available therefor and to share ratably in the assets of the Company available
upon liquidation subject to rights of creditors and any shares of Preferred
Stock. The holders of shares of Common Stock do not have the right to
cumulate their votes in the election of directors and, accordingly the holders
of more than 50% of all the Common Stock outstanding are able to elect all
directors. The current officers and directors beneficially held 4,984,975
(15.9%) of the shares outstanding and 7,362,975 shares or 21.9%, after giving
full effect to the exercise of their options exercisable as of February 23,
1998. Therefore, the officers and directors may be able to control the
Company.
PREFERRED STOCK
---------------
The Company is authorized to issue 10,000,000 shares of Preferred Stock,
$.001 par value per share. At February 23, 1998, the Company had: (a) 900
shares of Series B Convertible Preferred Stock issued and outstanding, with a
liquidation preference of $1,068,164 and convertible into 240,713 shares of
Common Stock, and (b) 200 shares of Series C Convertible Preferred Stock with
a liquidation preference of $222,619 and convertible into 64,489 shares of
Common Stock.
The Preferred Stock may be divided by the Company's Board of Directors
from time to time into one or more series. The Board of Directors is
authorized to determine the rights, preferences, privileges and restrictions,
including the dividend rights, conversion rights, voting rights, terms of
redemption (including sinking fund provisions, if any) and liquidation
preferences, of any series of Preferred Stock and to fix the number of shares
of any such series without any further vote or action by stockholders. The
Company has no present plans, proposals, commitments or arrangements to issue
any additional shares of Preferred Stock. The Company's Certificate of
Incorporation
-16-
<PAGE>
authorizes the issuance of Preferred Stock with such designations, rights, and
preferences as may be determined from time to time by the Board of Directors.
Accordingly, the Board of Directors is empowered, without shareholder
approval, to issue Preferred Stock with dividend, liquidation, conversion,
voting or other rights that could adversely affect the voting power or other
rights of the holders of the Common Stock. Although the Preferred Stock may
be used for any lawful purpose, the Company has agreed not to use it as an
anti-takeover device that could be utilized as a method of discouraging,
delaying or preventing a change in control of the Company without the approval
of the Company's stockholders.
REGISTRAR AND TRANSFER AGENT
The Registrar and Transfer Agent for the Company's Common Stock is
Corporate Stock Transfer, Inc., Denver, Colorado.
PLAN OF DISTRIBUTION
A portion of the Shares offered hereby are issuable by the Company in
original equity issuances to qualified Institutional Buyers (as defined in
Rule 144A promulgated under the Securities Act), institutional accredited
investors (as defined in Rule 501(A)(1), (2), (3) or (7) promulgated under the
Securities Act), other accredited investors and broker/dealers who are members
in good standing with the National Association of Securities Dealers, Inc. or
to foreign broker-dealers. The Shares offered hereby may be sold from time to
time by Selling Stockholders in one or more transactions in the over-the-
counter market, in negotiated transactions or a combination of such methods
of sale, at market prices prevailing at the time of sale, at prices related to
such prevailing market prices or at negotiated prices.
The Shares may be issued without restrictive legend and, subject to any
lock-up agreements entered into with the Company, may be sold without
restriction. Such shares may also be issued to the same classes of buyers with
restrictive legends for resale by such Selling Stockholders. Prior to any use
of this Prospectus for the resale of the Shares, this Prospectus will be
amended or supplemented, if necessary, to set forth the name of the Selling
Stockholder, the number of Shares beneficially owned by such Selling
Stockholder, and the number of Shares to be offered for resale by such Selling
Stockholder. The supplemented or amended Prospectus will also disclose whether
any Selling Stockholder has held any position or office with, been employed by
or otherwise had a material relationship with, the Company or any of its
affiliates during the three years prior to the date of the supplemented or
amended prospectus.
The Shares may be sold from time to time directly by the Selling
Stockholders and/or by their assignees, transferees, pledgees or other
successors for their own accounts and not for the account of the Company.
Alternatively, the Selling Stockholders may from time to time offer the Shares
through underwriters, dealers or agents. The distribution of the Shares by the
Selling Stockholders may be effected from time to time in one or more
transactions that may take place in the over-the-counter market including (a)
ordinary broker's transactions and transactions in which the broker solicits
purchases; (b) privately negotiated transactions or pledges, (c) through sales
to one or more broker/dealers for resale of such shares as principals,
pursuant to this Prospectus; (d) in a block trade (which may involve crosses)
in which the broker or dealer so engaged will attempt to sell the securities
as agent but may position and resell a portion of the block as principal
to facilitate the transaction; or (e) in exchange distributions and/or
secondary distributions, at market prices prevailing at the time of sale, at
prices related to such prevailing market prices or at negotiated prices. Usual
and customary or specifically negotiated brokerage fees or commissions may be
paid by these holders in connection with such sales.
The Selling Stockholders, Investors, their transferees, intermediaries,
donees, pledgees or other successors in interest through whom the Shares are
sold may be deemed "underwriters" within the meaning of Section 2(11) of the
Securities Act, with respect to the Shares offered and any profits realized or
commissions received may be deemed to be underwriting compensation. Any
broker-dealers that participate in the distribution of the Shares also may be
deemed to be "underwriters", as defined in the Securities Act, and any
commissions, discounts, concessions or other
-17-
<PAGE>
payments made to them, or any profits realized by them upon the resale of any
shares purchased by them as principals, may be deemed to be underwriting
commissions or discounts under the Act.
Registration of a portion of the Shares is being made pursuant to
agreements with the Company pursuant to which the Company will pay all
expenses incident to the offering and sale of the Shares to the public except
as described hereinafter. The Company will not pay, among other expenses,
commissions and discounts of underwriters, dealers or agents or the fees and
expenses of counsel for the Selling Stockholders. In some cases, the Company
has agreed to indemnify the Selling Stockholders and may indemnify any broker-
dealer that participates in transactions involving the sale of Shares against
certain liabilities, including liabilities under the Act. See "Commission
Position on Indemnification for Securities Act Liabilities" below.
There can be no assurance that the Company or any of the Selling
Stockholders will sell any or all of the Shares of Common Stock offered by
them hereunder.
The sale of the Shares is subject to the Prospectus delivery and other
requirements of the Act. To the extent required, the Company will use its
best efforts to file and distribute, during any period in which offers or
sales are being made, one or more amendments or supplements to this Prospectus
or a new registration statement with respect to the Shares to describe any
material information with respect to the plan of distribution not previously
disclosed in this Prospectus, including, but not limited to, the number of
shares being offered and the terms of the offering, including the name or
names of any underwriters, dealers or agents, if any, the purchase price paid
by the underwriter for Shares purchased from a Selling Stockholder, and any
discounts, commissions or concessions allowed or reallowed or paid to dealers
and the proposed selling price to the public.
Under the Exchange Act, and the regulations thereunder, any person
engaged in a distribution of the Shares of the Company offered by this
Prospectus may not simultaneously engage in market-making activities with
respect to the Common Stock of the Company during the applicable "cooling off"
period five business days prior to the commencement of such distribution. In
addition, and without limiting the foregoing, the Selling Stockholders will be
subject to applicable provisions of the Exchange Act and the rules and
regulations thereunder, including without limitation, Regulation M, in
connection with transactions in the shares, which provisions may limit the
timing of purchases and sales of Shares by the Selling Stockholders.
COMMISSION POSITION ON INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES
Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the small business
issuer pursuant to the foregoing provisions or otherwise, the Company has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable.
-18-
<PAGE>
LEGAL MATTERS
The validity of the Shares offered hereby will be passed upon by Snow
Becker Krauss P.C., 605 Third Avenue, New York, New York 10158. Snow Becker
Krauss P.C. owns 43,823 shares of the Company's Common Stock and individual
members of the firm own additional shares of Common Stock.
EXPERTS
The consolidated financial statements of AgriBioTech, Inc. as of June 30,
1997 and 1996 and for the years then ended and the nine-month period ended
June 30, 1995, have been incorporated by reference herein in reliance upon the
report of KPMG Peat Marwick LLP, independent certified public accountants,
incorporated by reference herein and upon the authority of said firm as
experts in accounting and auditing. The report of KPMG Peat Marwick LLP refers
to the retroactive effect of a change in accounting for its convertible
preferred stock.
The combined financial statements of Germain's Inc. and W-L Research,
Inc. as of September 30, 1995 and 1994 and for the years then ended have been
incorporated by reference herein in reliance upon the report of KPMG Peat
Marwick LLP, independent certified public accountants, incorporated by
reference herein and upon the authority of said firm as experts in accounting
and auditing.
The consolidated financial statements of E.F. Burlingham & Sons as of
December 31, 1996 and for the year then ended, have been incorporated by
reference herein in reliance upon the report of KPMG Peat Marwick LLP,
independent certified public accountants, incorporated by reference herein and
upon the authority of said firm as experts in accounting and auditing.
The financial statements of Olsen Fennell Seeds, Inc. as of December 31,
1996 and for the year then ended have been incorporated by reference herein in
reliance upon the report of KPMG Peat Marwick LLP, independent certified
public accountants, incorporated by reference herein and upon the authority of
said firm as experts in accounting and auditing.
The combined financial statements of Seed Corporation of America, Inc.
and Green Seed Company Limited Partnership as of December 31, 1997 and 1996
and for the years ended have been incorporated by reference herein in reliance
upon the report of KPMG Peat Marwick LLP, independent certified public
accountants, incorporated by reference herein and upon the authority of said
firm as experts in accounting and auditing.
The financial statements of Lofts Seed, Inc. as of November 30, 1997 and
December 31, 1996 and for the eleven-month period ended November 30, 1997 and
the six-month period ended December 31, 1996 have been incorporated by
reference herein in reliance upon the report of Cannon & Company, independent
certified public accountants, incorporated by reference herein and upon the
authority of said firm as experts in accounting and auditing.
-19-
<PAGE>
The financial statements of Lofts Seeds, Inc. as of June 30, 1996 and
1995 and for the years then ended have been incorporated by reference herein
in reliance upon the report of Amper, Politziner & Matia, independent
certified public accountants, incorporated by reference herein and upon the
authority of said firm as experts in accounting and auditing.
The financial statements of Budd Seed, Inc. as of November 30, 1997 and
December 31, 1996 and 1995 and for the ten-month period ended November 30,
1997 and the years ended December 31, 1996 and 1995 have been incorporated by
reference herein in reliance upon the report of Cannon & Company, independent
certified public accountants, incorporated by reference herein and upon the
authority of said firm as experts in accounting and auditing.
The financial statements of Sunbelt Seeds, Inc. as of November 30, 1997
and January 31, 1997 and 1996 and for the ten-month period ended November 30,
1997 and the years ended January 31, 1997 and 1996 have been incorporated by
reference herein in reliance upon the report of Blackwell, Poole & Company,
independent certified public accountants, incorporated by reference herein and
upon the authority of said firm as experts in accounting and auditing.
The financial statement of Willamette Seed Co. as of June 30, 1997 and
1996 and for the years then ended have been incorporated by reference herein
in reliance on the report of Price, Koontz & Davies, P.C., independent
certified public accountants, incorporated by reference herein and upon the
authority of said firm as experts in accounting and auditing.
-20-
